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Sensex, Nifty rebound; Tata Motors SBI gain, Maruti falls


The News International Team

9:50 am Good time to buy telecom stocks? With the action in the ongoing telecom spectrum auction appearing to be slowing down over the past few days, bidding by companies has become very selective and may end in a day or two, Suresh Mahadevan, MD and Head of Asian Telecom and Media Research, UBS AG said.

Mahadevan pointed out that premium telecom companies paid over the reserve price to buy spectrum was higher than most analysts had forecasted — as much as 82 percent in some cases – and that, accordingly, he expected tariffs to go up.

“Now that the key 900 Mhz spectrum has been secured for the next 20 years, the fundamentals of the sector will get better. I expect telecom stocks to rally after the auction,” he said.

9:30 am Buzzing: Shares of Maruti were under pressure in early trade on Wednesday. The auto-major will recall 33098 units including 19780 units of Alto 800 and 13318 units of Alto K10, citing problems in right hand door latch assembly.

“Maruti will proactively inspect and replace the right hand door latch assembly manufactured between 8 December and 18 February. Maruti Suzuki dealers in the domestic market will contact owners of all the affected vehicles. The dealer workshop technicians will inspect the condition and carry out the necessary replacement, free of cost,” it said in a statement to the bourses.

However, the company has added that there is no concern if the right hand side door, both front and rear, is completely latched.  If the door is half-latched, then the door may open if pressure is applied from inside, it said.

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The market rebounded with marginal gains after falling in previous two sessions. The Sensex rose 38.63 points to 28748.50 and the Nifty climbed 13.95 points to 8726.

About 544 shares have advanced, 158 shares declined, and 99 shares are unchanged on the Bombay Stock Exchange.

Tata Motors, Larsen & Toubro, Sun Pharma, SBI, ITC, Reliance Industries, Axis Bank, Infosys, ONGC and Cipla gained 0.3-0.9 percent while TCS, M&M, Maruti Suzuki, Hero Motocorp, Coal India, NTPC and BHEL fell 0.5-0.9 percent.

Meanwhile, the Indian rupee opened marginally lower at 62.83 per dollar today versus 62.76 Tuesday.

Himanshu Arora of Religare said, “Rupee is expected to trade higher today following the strong current account deficit data. Weak trade deficit data and dollar strength against a basket of currencies is expected to keep a cap on rupee today. Expect the rupee to trade in the range of 62.52-62.95/dollar.”

Current account deficit in October to December 2014 narrowed to over USD 8 billion which is just 1.6 percent of GDP.

Among global markets, in the US, stocks closed at 1 month lows losing more than 1.5 percent lower pressured by a surge in the dollar and some weakness in oil. Both Dow Jones and S&P 500 breached their 50-day moving average, wiping off their 2015 gains. Meanwhile, the US 10-year treasury yield slid to 2.13 percent.

In Asia, markets are weak this morning but Nikkei is the standout performer. Japan’s January machinery orders rose an unexpected 1.9 percent year-on-year, better than expectations for a 1 percent drop.

On a monthly basis, the leading indicator of capital spending notched down 1.7 percent, smaller than the 4.1 percent slump estimated. Yesterday, yen touched its lowest level since July 2007.

Among commodities, Brent crude prices slipped nearly 3 percent yesterday to around USD 56 per barrel. However, it pulled back some losses in trade today led by a fall in US crude inventories. 

From precious metals space, gold is trading at its lowest level in nearly four months as dollar rose to its highest in nearly 12 years.

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